Cattle on Feed Down 8 percent

The USDA's Cattle on Feed report for the month of September was released last Thursday. No big surprises. Cattle and Calves on feed for slaughter market for feedlots over a 1,000 or more head totaled 10.1 million head which is 8 percent below a year ago. While placements were up 1 percent over that same period.

USDA Livestock Analyst Shayle Shagam explains

Shagam: "Even though we did see an increase in the number of placements during September -- and this is pretty much where traders expected it would be -- it does point to the fact that we have smaller numbers of cattle on feed which is going to mean that beef production in the future is going to get tighter. And we are going to be looking at higher fed cattle prices and looking at probably higher retail beef prices moving forward."

As for the increase of number of cattle replaced on feedlots in September, Shagam says

Shagam: "Fed cattle prices expectations of continued strength in fed cattle prices which encouraged feed lot operators to bid higher for feeder animals and bring more animals into their lots."

He shares additional information from the report.

Shagam: "The number of fed cattle marketed in September was just under 1.7 million head about 6 percent above a year ago. However there was one extra slaughter day during September this year compared to last year, so if you make your adjustments to bring your number of slaughter days equal to last year, you are talking about a marketing number that was just under 1 percent above a year ago."